How to prevent overdrafts
Learn more about our products and services to avoid account overdraft fees and missed payments.
What’s an overdraft?
An overdraft occurs when your account balance is less than 0, meaning there are insufficient funds for payments and withdrawals. For example, if a $1,500 preauthorized withdrawal is debited from your account when the balance is $1,000, your account is then overdrawn by $500.
If there are insufficient funds in your everyday account, the following transactions can lead to an overdraft:
- Cheque payments
- Bill payments
- Direct payments by credit card
- Loan repayments
- Withdrawals
- Direct withdrawals (pre-authorized payments automatically withdrawn from your account)
- Transfers between accounts
Avoiding charges with overdraft protection
If your account is overdrawn, an overdraft protection solution like a line of credit can help.
If you have enough funds in your line of credit, you can use it to cover your account and avoid declined transactions, late payment charges and NSF fees.
Personal Line of Credit
A tailored line of credit offers flexible overdraft protections and can help you manage your day-to-day spending.
First, you’ll have to apply and get approved. Then, you can use your line of credit to cover the overdraft. You’ll pay interest on any amount you’ve borrowed from the line of credit until you pay it back in full.
Cash advances
You can transfer any available credit you have on your credit card to your everyday account to cover the overdraft. You‘re charged interest as soon as you make the transfer.
Cash advances cost you more, so you should only use them to pay for unexpected expenses.
Services to help prevent overdrafts
Get a clear picture of your upcoming withdrawals and expenses so you never miss a payment or get charged overdraft or credit fees. Use our mobile and online services to better track your account activity and make sure you have enough money for upcoming payments.
Create a budget and plan ahead
Use our budget planning tool to keep track of money coming in and out and avoid surprise fees.
FAQ
Can I still sign up for the overdraft transfer service?
Starting November 23, 2025, you can no longer sign up for overdraft transfers with your credit card. Current users have access to this service until March 28, 2026.
A Personal Line of Credit, student line of credit and Versatile Line of Credit are also good overdraft protection options. To get any of these products, you’ll need to apply.
What are the fees for overdrafts?
For more information about overdraft fees and fees for cheques or preauthorized payments without funds, see the Service fees page.
If you use your line of credit for overdraft protection, you’ll be charged credit charges on the amount you borrow to cover your overdraft, based on the interest rate you qualified for.
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